GLOBALISATION has become a premier source of revenue growth for corporations that are based in both developed nations and emerging economies. Venturing to new markets in a slumping economy requires innovation — whether through people, processes or technologies.

Fifty-four percent of respondents in a survey on the power of innovation said that globalisation is a major focus for their companies, according to a report by the Economist Intelligence Unit (EIU). A third of respondents said that globalisation would be a major focus for their firms five years from now.

The EIU, a unit of the Economist Group, which publishes The Economist weekly, is a provider of country, industry and management analysis.

The EIU conducted a survey last September involving 197 respondents from Asia-Pacific, North America, Western Europe, the Middle East and Africa for the report titled Leveraging the Power of Global Innovation. The C-suite made up 38% of the respondents while 15% were senior vice-presidents or directors.

The study identified several obstacles to leveraging global innovation. Respondents cite a lack of awareness (45%), cultural differences (45%) and internal politics (38%) as the leading challenges to supporting global innovation.

Although 74% of respondents said they have personally worked with colleagues from other countries to improve business processes, initiatives that cross borders only succeed to the extent that people with different backgrounds, speaking different languages, and motivated by different incentives can work together.

The report also found that the success of an innovation initiative also depends on senior management. Respondents agree that senior managers are “very influential” in 71% of such efforts.

Technology may hasten global innovation but one-fifth of respondents said that there was no consistency to their technology applications. The companies that are ahead in their global initiatives tend to have a multiplicity of systems, few of which work seamlessly together.

Thus far, Web 2.0 technologies have not done much to help; tools such as social networking software and cloud computing (software accessed over the Internet) have not figured significantly in global innovation initiatives.

For effective innovation, executives must create proper incentive schemes, provide adequate training and communicate the value of global innovation.

Companies should focus on their strength or advantage, accept and expect mis-steps and tap every worker’s ideas, said the EIU study. Companies need to get their employees to share their sense of mission by creating an atmosphere where people feel there is value in their participation, it added.

This article appeared on the Management page, The Edge Financial Daily, March 16,2009.